the NZD/USD is building a choppy, sideways price movement at the 21 ema zone. This is typical for a wave 4 correction.
This article reviews what to expect after a wave 4 is completed. We also analyse potential trading ideas and targets.
The NZD/USD seems to have completed a wave 4 (pink). Here are the main factors:
The confirmation of the uptrend continuation occurs when price action manages to break (green arrows) above the resistance trend line (orange).
The main target of the wave 5 (pink) is the -27.2% Fibonacci target at 0.75.
A bearish breakout does not mean that the uptrend is over. The 38.2% Fib and support trend line (green) are likely to create a bullish bounce (blue arrow).
On the 4 hour chart, price action seems to have completed an ABCDE (grey) triangle chart pattern within wave 4 (pink).Now price action is pushing up via a wave 1-2 (grey).
A breakout could confirm the start of the wave 3 (grey). But it is key to see a bull flag emerge after the breakout. Strong bearish price action should not appear.
The bullish outlook remains valid as long as price action remains above the 100% Fibonacci of wave 2 (grey). A break below invalidates it (red circle).